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HomeMy WebLinkAbout2011-02-14 - Agendas - Final Fayetteville Fireman's Pension and Relief Fund Meeting Date February 14, 2011 Adjourn Time 3:45 p.m. Attendees: Gene Warford, Ronnie Wood, Pete Reagan, Marion Doss, Mayor Jordan, Sondra Smith, City Attorney Kit Williams, Audience and Press Subject: Roll Call Mayor Jordan Present Marion Doss Present Pete Reagan Present Gene Warford Present I Ronnie Wood IPresent ISondra Smith IPresent Subject: PRB Question # 1 Subject: PRB Question#1 TA) The Board is awaiting the outcome of the TB) The Board as a whole has not taken any 2011 Legislative Session to see what benefits action since the October 18, 2010 Special we can gain from the Guarantee Fund Meeting Motion To: Approve Motion To: Approve Motion By: Pete Reagan Motion By: Marion Doss Seconded: Gene Warlord Seconded: Gene Warlord Mayor Jordan Yes Mayor Jordan Yes Marion Doss IYes Marion Doss Yes Pete Reagan Yes Pete Reagan Yes Gene Warford Yes Gene Warford Yes Ronnie Wood Yes Ronnie Wood Yes Sondra Smith No Sondra Smith No Fayetteville Fireman's Pension and Relief Fund Meeting Date February 14, 2011 Adjourn Time 3:45 p.m. Attendees: IGene Warford, Ronnie Wood, Pete Reagan, Marion Doss, Mayor Jordan, Sondra Smith, City Attorney Kit Williams, Audience and Press I Subject: PRIB Question #2 Subject: PRIB Question#2 TA—) Pursuant to State law the Fayetteville TB—) The Fayetteville City Council has been made City Council has been informed several times aware of the dire financial condition of the fund during recent years that the Firemen's several times. Pension Fund is not actuarially sound. Motion To: Approve Motion To: Approve Motion By: Gene Warford Motion By: Pete Reagan Seconded: Pete Reagan Seconded: Marion Doss Mayor Jordan Yes Mayor Jordan Yes Marion Doss IYes Marion Doss Yes Pete Reagan Yes e e eagan Yes Gene Warford Yes Gene Warford Yes Ronnie Wood Yes Ronnie Wood Yes Sondra Smith Yes Sondra Smith Yes Fayetteville Fireman's Pension and Relief Fund Meeting Date February 14, 2011 Adjourn Time 3:45 p.m. Attendees: lGene Warford, Ronnie Wood, Pete Reagan, Marion Doss, Mayor Jordan, Sondra Smith, City Attorney Kit Williams, Audience and Press Subject: PR13 Question #3 Subject: PR13 Question#4 Ves It would have been helpful if the report came a few days prior to the meeting so that the Firemen's Pension Board would have more time to study the information. Motion To: Approve Motion To: Approve Motion By: Gene Warford Motion By: Ronnie Wood Seconded: Pete Reagan Seconded: Pete Reagan Mayor Jordan Yes Mayor Jordan Yes Marion Doss IYes Marion Doss Yes Pete Reagan Yes e e eagan Yes Gene Warford Yes Gene Warford Yes Ronnie Wood Yes Ronnie Wood Yes Sondra Smith Yes Sondra Smith Yes Fayetteville Fireman's Pension and Relief Fund Meeting Date February 14, 2011 Adjourn Time 3:45 p.m. Attendees: IGene Warford, Ronnie Wood, Pete Reagan, Marion Doss, Mayor Jordan, Sondra Smith, City Attorney Kit Williams, Audience and Press I Subject: PRB Question #5 Subject: PRB Question#5 TA—) The Pension Review Board staff should TB—) The Fayetteville Firemen's Pension Board track and advise our Board of any legislative asks the Pension Review Board to explore a changes that would affect our fund or the change to State statute to allow a benefit Guarantee Fund. reduction for plans above the State mandated level. Motion To: Approve Motion To: Approve Motion By: Pete Reagan Motion By: Mayor Jordan Seconded: Gene Warford Seconded: Sondra Smith Mayor Jordan Yes Mayor Jordan Yes Marion Doss IYes Marion Doss Yes Pete Reagan Yes e e eagan No Gene Warford Yes Gene Warford Yes Ronnie Wood Yes Ronnie Wood Yes Sondra Smith Yes Sondra Smith Yes Firemen's Pension&Relief Fund Board of Trustees Agenda February 14,2011 Page t of I Lioneld Jordan Chairman Pete Reagan Position 2/Retired Ron Wood Position 4/Retired Sondra E.Smith Secretary Gene Warlord Position 3/Retired Marion Doss Position l/Retired Fayve e;iiie ARKANSAS Firemen's Pension and Relief Fund Board of Trustees Meeting Agenda February 14, 2011 A Special meeting of the Fayetteville Firemen's Pension and Relief Fund Board of Trustees will be held at 3:00 PIVI on February 14, 2011 in Room 326 of the City Administration Building. Old Business: PRB letter regarding the projected insolvency status of the fund. Need to send them a response letter: 1. What actions have you planned as a result of the Special Report? 2. What discussions have you had with the city officials to explore solutions? How has your city board been made aware? 3. Did you find the Special Report helpful in your planning? 4. What would you have wanted to have been included in the Special Report that was not previously included? 5. What additional information could be provided by the PRB to assist your fund? R B ARKANSAS FIRE&POLICE PENSION REVIEW BOARB 620 W.3rd,Sufte 200 Little Rock,Arkansas 72201-2223 Telephone:(501)682-1745 December 16,2010 RECEIVED Toll-Free:(866)859-1745 Fax:(501)682-1751 Board of Trustees DEC 17 2010 email:info@lopfi-prb.com Fayetteville Fire Pension Fund CITY OF FAYETTEVILLE website:www.lopfi-prb.com 113 W. Mountain CITY CLEWS OFFICE Fayetteville,AR 72701 Re: Projected Insolvent Status (Via: Certified Mail) Dear Trustees: The Arkansas Fire and Police Pension Review Board(PRB)has reviewed the results of the December 31,2009 actuarial valuations and has found that the projections used to identify underfunded plans under ACA 24-11-208 require us to declare that your fund still meets the definition of a"projected insolvenf' plan as described in that section. During 2010, the PRB provided to you through our actuary a detailed projection and simulation of your Rind showing various actions that could be taken. These included adding income streams and consolidation with LOPF1. We do not plan on providing an update to this study at this time unless you request it. We would like to have an update from your fund so that the PRB will know how to best help your fund improve its funding. 1. What actions have you planned as a result of the Special Report? 2. , What discussion have you had with the city officials to explore solutions? How has your city board been made aware? 3. Did you find the Special Report helpful in your planning? 4. What would you have wanted to have been included in the Special Report that was not previously included? 5. What additional information could be provided by the PRB to assist your fund? We would appreciate a response to the PRB in writing by the end of February,2011, This would allow the PRB to discuss and authorize any additional help for your fund during our March 2011 regular board meeting. Thank you for your attention to this issue. Respectfully, David B. Clark Executive Director Cc: PRB Members January 27, 2011 This is my response, as a member of this board,to the Pension Review Boar&s letter dated December 16, 2010. 1 ask that a copy of this response be attached to the minutes of this meeting. The second sentence in paragraph two says, "These included adding income streams and consolidation with LOPFI." What are these "income streams" and where will they come from? What exactly is the PRB referring to when they say "income streams?" Question#1: What actions have you planned as a result of the Special Report? We as a board have met two times since the October special meeting when the PRB presented their special report. According to the minutes of our regular October 28th meeting,the only discussion on this special report was that Sondra had emailed a copy of that report to us. Kit mentioned that the report was discussed on Monday. I assume that he meant Monday, October 18. The minutes of our November l8th meeting shows that we did not discuss at all this special report. The answer then to this first question is nothing. We, as a board, have not planned any actions as a result of the special report. We need to address this. Question #2: What discussion have you had with the city officials to explore solutions? How has your city board been made aware? We as the pension board have had no discussions with any city official about this special report. Over the past several years we have occasionally discussed during regular meetings the soundness of the fund: the mayor,city attorney, finance director and occasional city council member have been present. We have not arrived at any solution. Several times I have expressed my belief that consolidation with LOPFI is the best solution. I understand that this solution will law(Act 1266 of 1995)goes to the Arkansas Fire and Police Pension Guarantee Fund(the Fund). Since our pension fimd is only receiving Amills does that mean that we cannot expect to be eligible for this guarantee fund? It is my understanding that to be eligible for this guarantee fimd the city must be collecting a dedicated millage of I mill for the fire pension fund. I think everybody needs to know whether or not we would be eligible for this guarantee fimd Mi order to make good decisions. As a board we need to answer these questions that the PRB has asked us. We need to do this as they have requested by the end of February. Therefore I make a motion that our secretary prepare a response to the special report as requested by the PRB that includes my questions and any other questions that any board member may have by February 17, 2011. WILL WE NEED TO HAVE A SPECIAL MEETING ONCE THAT LETTER IS PREPARED AND OFFICIALLY APPROVE ITS CONTENTS BEFORE SHE SENDS IT? IF SO....I make a motion to have a special meeting on Thursday,February 17,2011 in order to approve our response to the PRB. February 10, 2011 David Clark, Executive Director Arkansas Fire & Police Pension Review Board 620 W 3rd Street Suite 200 Little Rock, AR 72201 RE: Firemen's Pension and Relief Fund Board of Trustees Projected Insolvent Status Dear Mr. Clark: As a member of the governing body of the Firemen's Pension and Relief Fund Board of Trustees I am very concerned about the current status of the Firemen's Pension Fund. I have requested on more than one occasion that benefits (that were increased before I became a member of the governing body) be reduced in order to ensure the viability of the fund. The following is my response to your letter regarding the Projected Insolvent Status of the Firemen's Pension Fund dated December 16, 2010. What actions have you planned as a result of the Special Report? The board as a whole has not planned any action although it has been discussed at our meetings. I plan to continue to pursue a reduction in benefits. I believe this is the only way to maintain the solvency of the plan and to receive future support from our City Council. What discussions have you had with the city officials to explore solutions? A joint meeting was held with the Fayetteville City Council, Firemen's Pension Board and the Pension Review Board on October 18, 2010. At that meeting several of the City Council members expressed that a reduction in benefits should be pursued. A copy of the October 18, 2010 minutes is attached. How has your city board been made aware? Pursuant to state law the Fayetteville City Council has been informed several times during recent years that the Firemen's Pension Fund is not actuarially sound. 2. The joint City Council and Firemen's Pension Board meeting of October 18, 2010 conducted by you explained the dire financial predicament of the Pension Fund. Did you find the Special Report helpful in your planning? This was the second special report that we received. The information was basically the same each time. With the current makeup of the board it is very difficult to come to a consensus in our planning for the future of the plan. What would you have wanted to have been included in the Special Report that was not previously included? The Special Report seemed to imply that the City should infuse city money into the Firemen's Pension Fund to make it viable. The City of Fayetteville taxpayers are already contributing tax dollars to the Firemen's Pension Fund. I would have liked more information included on what the pension fund should incorporate to make their fund sustainable. What additional information could be provided by the PRB to assist your fund? The Board of Trustees received a report from Osborn, Carreiro &Associates, Inc. on November 19, 2009, stating that for the fund to stay solvent, as it currently exists, it will be necessary for additional across the board reductions to be implemented. Rules and Regulations governing these plans have been implemented over the years by the PRB Board. I implore the PRB Board to implement any PRB rule change that might be necessary to Allow for a reduction in benefits, if a plan is above the State mandated level. I also implore the PRB Board to lobby State legislators to change State statutes, if necessary, to allow for a benefit reduction for plans that are above the State mandated level. In closing I would like to thank the Pension Review Board for their time. I certainly hope that we can work together to sustain the plan to ensure pensioners continue to receive benefits. Sincerely, Sondra E. Smith Firemen's Pension and Relief Fund Secretary City Clerk Treasurer Seite I From: Peter Reagan <preaganl4@gmail.com> To: <mayor@ci.fayefteville:ar.us5-, <Ijordan@ci.fayetteville.ar.us>, <city—cl... Date: 2/14/2011 8:46 AM Subject: PRB Questions answered PR Attachments: PRB Questions answered PR 2.14.1 1.doc Mayor Jordan, Attached are my answers to the five questions the Arkansas Pension Review Board requested we answer. I request that they be incorporated in the final draft letter. As always, if you have any questions, please contact me. Regards Peter T Reagan, Trustee Fayetteville Firemen's Pension and Relief Fund P 0 Box 1922 Fayetteville AR 72702 E-preagonl4@gmaii.com C -479-841-0320 Fayetteville Firemen's Pension and Relief Fund Mayor Lionald Jordan, Chairman Chairman Jordan, Below are my answers to the 5 questions the Arkansas Pension Review Board requested we answer. I request that they be incorporated in the final draft. I. At a previous FFD Pension Board meeting, it was discussed and agreed to by myself and the Chairman to wait and see what came out of the 2011 Legislature that would allow us to benefit from the"Guarantee Fund". 2 The only solution the "City of Fayetteville"officials have on their radar is the reduction of benefits to all retirees. It was quite obvious that the City Attorney has explained to them his position which is : a. The City of Fayetteville has no Liability for the Fund b. We as a Pension Board can reduce benefits to retirees, even though two Arkansas AG opinions say different. 3 Yes,I found the special report helpful. 4. 1 would have preferred to have the report much sooner to read and review prior to the combined meeting with City Alderman. 5 None, PRB Staff has been very responsive to all questions and information requests. Respectfully Submitted Peter T Reagan, Trustee 2.14.2011